How financial planning and charitable gifting can go hand in hand

For more than 25 years, Herbert Scott has helped people achieve their life’s goals through meaningful financial planning and that often includes charitable gifting.

Our focus is often on clients coming up to, or in the early phases of, retirement. Understandably, as clients age, the early question of “have I got enough to live the life I want in retirement?” evolves into “what can I do to mitigate my Inheritance Tax bill?”.

Charitable gifting

Not all clients have wider family to pass their funds on to, and even those that do still often wish to undertake an element of charitable gifting. This can either be during their lifetime, when the value of the gifted funds could potentially be outside of their estate immediately, or in their Wills when the rate of IHT applied can be reduced from 40% to 36% where 10% or more of their taxable estate is left to charity.

Working with Sussex Community Foundation

It is at times like this that we often turn to the expertise of Sussex Community Foundation to better the philanthropic conversations we have with our clients. From our viewpoint, involving the Foundation in these discussions provides us with confidence about the charitable gifting our clients undertake, safe in the knowledge that the charities have undergone the scrutiny of the Foundation’s due diligence. It also broadens our clients’ awareness of charities which are of particular interest to them and gives them the opportunity to have as much (or as little) involvement with the charities as they feel comfortable with.

Case study

We recently introduced an elderly client to the Foundation, after using our cashflow planning software to establish she had more than sufficient wealth to meet any eventualities she was likely to encounter during her remaining lifetime, including the potential funding of care fees. She wanted to see what other options there were to reduce the Inheritance Tax bill on her estate and, while she was not averse to paying some Inheritance Tax, the idea of having some control over where her surplus money was spent appealed, rather than leaving this decision to the Government on her death.

We explored options such as increasing gifting to her family, investing in tax-lead Inheritance Tax planning schemes, and charitable gifting. At this point, we introduced our client to the Foundation so that they could help her gain a better understanding of the range of local charities and community groups that aligned with her philanthropic interests. Under their guidance she decided to set up a Donor Advised Fund.

On a personal note, I continue to be heartened by the number of clients who are interested in making charitable donations as part of their financial plan and having good conversations around this subject is a valuable part of the service we provide.

Tracey Payne BA(Hons), Chartered FCSI, DipPFS
Investment Director & Financial Planner

Herbert Scott Ltd
The Left Bank, 173 High Street, Lewes, East Sussex, BN7 1YE

enquiries@herbertscott.uk
www.herbertscott.co.uk

Herbert Scott is authorised and regulated by the Financial Conduct Authority.

This article is distributed for information and/or educational purposes and should not be considered investment advice or an offer of any product for sale.

For Professional Advisors

For Professional Advisors.

Are you a professional advisor with a client who wants to give back to their community?

Do you have clients who want to make a positive impact in their community? We’re meeting more and more people who are passionate about using personal, family or business wealth to take on challenges they see on their doorstep. And with some parts of Sussex among the 10% most deprived areas in England, we know the challenges are there to be solved.

As a professional advisor, you will want to find the most efficient and effective route to achieving your client’s philanthropic goals. And this is where we can help. We partner with professional advisors such as solicitors, accountants and wealth managers, to help their clients invest their resources in the local charities and community groups who need it most and can use it best.

Put an experienced team behind your client.

We’re people who want to make an impact too. Our passionate and motivated staff team has expertise in grant-making, philanthropy, local community needs and finance. They’re overseen by a trustee board of experienced local people, many with legal, financial and professional backgrounds.

Contact Philanthropy team to find out more about how we can help. Or follow us on LinkedIn to read more of our giving stories.

Read our leaflet ‘Expert Local Philanthropy Advice’ for Professional Advisors here

 

What we can do for you and your clients.

  • We can create a Donor Advised Fund your client can use to give to causes they care about, in a tax-efficient way that can also involve future generations. Either through invested funds that keep on giving, funds for immediate impact, or a combination of the two.
  • We can help to set up legacies so that clients can create lasting local value through their Wills and estates.
  • We can support or take on charitable trusts where the administrative burden has become too much, trustees are struggling to fulfil the objects, or the future is unclear.
  • We can provide bespoke, expert advice and guidance on all areas of charitable giving and local philanthropy.

How we can help.

We help people with resources to create the lasting, local impact they seek, through grants to Sussex’s network of small, effective charities and community groups.

  • We provide advice on effective charitable giving, to maximise impact and minimise admin and cost.
  • We carry out research to understand the specific needs and challenges of communities across Sussex.
  • We build relationships with the charities and community groups that are helping to meet them.
  • We ensure due diligence and reporting are carried out on every grant made.

Frequently Asked Questions

If my client is considering giving to Sussex Community Foundation, what are their options?

There are many options to explore depending on their circumstances and type of gift. These can include: 

Is there a minimum investment?

It varies depending on how the clients give. To set up a Donor Advised Fund, we would recommend a minimum £25k investment to ensure a sufficient annual return for grant making. We are happy to explain how a gift is invested and what returns can be expected.

No minimum investment is required for legacies or to give to our funding priorities, which are pooled funds.

What assets do you accept?

We can accept gifts in cash, shares, land, property and even things like artwork. Each donor is different, and we work on a bespoke, case-by-case basis.  

Can my client remain anonymous? 

Yes, and many of our donors choose to. 

Will my client be able to see the impact their donations make and visit projects they fund?

Yes. They receive annual impact reports which give a full breakdown and case studies, and we can also arrange visits to the charities they fund. 

Sign up to our newsletter for Professional Advisors




“I have always seen real value in what Sussex Community Foundation has to offer to our clients. The client can set up their own fund with them, which is a very effective way of managing money whilst still being involved in making decisions on grants – but without the admin and the other boring bits.”

John Bunker
-
Consultant Solicitor and Chartered Tax Advisor, Irwin Mitchell
Our Fundholders
Skip to content